Learn the whole new way of Kraft foods supply chain management with this case study provided by welingkar online. Kraft Foods has streamlined its supply chain, and its benefits included a more efficient ordering and delivery processes, better management of resources and cost savings. They achieved this by building a Customer Service Excellence Programme to ensure that its products are in the right place, at the right time, in the right quantity, in excellent condition and at the lowest possible supply chain cost.

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Kraft Foods Supply Chain Case Study
Summary
Kraft has streamlined its supply chain, and its benefits included a more efficient ordering and delivery
processes, better management of resources and cost savings. They achieved this by building a Customer
Service Excellence Programme to ensure that its products are in the right place, at the right time, in the
right quantity, in excellent condition and at the lowest possible supply chain cost.
Key challenges
Consumers expect their favorite brands to be available on demand and to be of the highest quality.
However, consumers are seldom aware of what it takes to get these products to us in prime condition.
The immediate challenge faced by Kraft Foods’ Supply Chain function was contributing excellent
operational support and delivering continued growth.
Solution
The stated Supply Chain goal of Kraft Foods is to 'exceed customer expectations in quality of product
and service at lowest effective cost'. Kraft’s is a powerful brand that looks to add value and differentiate
itself on the basis of its quality, values and a fostering of trust.
To help in achieving these objectives, Kraft Foods rolled out a model named the “Service Excellence
Programme”. Simply put, this model looks to enhance the customer service experience while at the
same time reducing costs incurred as part of the Supply Chain. This is done via a series of concepts that
creates a strong Supply Chain relationship between the company and its retailers. Kraft focused on
delivering to their retailers, whenever they want it, wherever they want it. By listening to and being
empathetic towards their retailers, Kraft Foods helped to manage stocks optimally, meet all seasonal
variations in demand and responded quickly to supply constraints and bottlenecks.
Kraft Foods developed a 9 point framework to build, implement and evaluate projects with the aim of
improving day to day operational efficiency. They are concisely summed up as below.
Perfect Ordering focuses on the perfect management of the exact retail requirement right from the
moment an order is placed, then processed and finally delivered at the customer warehouse. The use of
accurate data, sent at agreed timings with jointly agreed delivery windows helped facilitate this.
Knowledge exchange involves a thorough understanding of the Supply Chain from end-to-end (including
systems and processes) by all partners. This was achieved via simple explanations on the premises to job
swaps. This helped build a comprehensive knowledge base of the systems, people and processes
involved. E-mails and extranets have further smoothened the knowledge sharing process.

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High quality Seasonal planning ensured that the Supply
Chain coped with high volume special events such as
Christmas, Valentine’s Day, the Olympics, etc. This
included the sharing of historical forecast information,
agreeing purchase quantities, arranging delivery timings
and ensuring accurate product specification data is shared
with all partners.
To move stock rapidly and efficiently, a delivery interface
was developed to help Kraft Foods and its partners
understand each other's distribution operations. Once an
order was placed with Kraft Foods, the order needed to be
shipped on time as per requirements. This also helped
reduce errors or discrepancies.
Kraft Foods believed in the need for great people, without
which managing a Supply Chain relationship is impossible.
Professionalism, trustworthiness, helpfulness, passion and
responsiveness were cornerstones on which the Supply
Chain partnership was built, and it was made possible by
the people involved.
Maintaining optimal inventory is vital to satisfying
demand. Holding excess stocks defeats the purpose of
Supply Chain Management, and to optimize inventory
trading partners needed to anticipate future demand so
that the product is produced at the right time. Information
on stock held at manufacturing plants and warehouses
was shared with everyone, ensuring everyone acted upon
the same information at all times.
Also critical was data alignment, so that all partners have
the same data about a given product. This will include but
is not limited to product description, number of units in a
case, number of cases on a pallet, bar codes, shelf life, etc.
Increasingly, technology has proven to be a great enabler
in sharing this information through extranets and online
catalogues.
Variant management is also of importance, for example
when a promotional product forces a change. This also
happens when new products are launched, demand or

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product specifications change and it is important to manage change and keep service levels uniform at
all times.
The consumer is of paramount importance, as is consumer satisfaction. This is achieved by consistently
delivering a high quality product and managing the experience expertly if a quality experience is not
delivered. Optimal consumer satisfaction is achieved by constantly reviewing consumer complaints, the
mechanism used to resolve it, product recall policies, and feedback mechanisms.
Outcome
Kraft Foods has been able to substantially improve the quality of service thanks to the implementation
of this programme by:
Improving the understanding of the Supply Chain.
Smoothening the order and delivery processes.
Better managing change.
Making sure skilled people focus on the right tasks.
Kraft Foods’ Customer Service Excellence Programme provides a simple blueprint for best business
practice when it comes to Supply Chain Management. No matter whether you are an avid student or a
businessman, Kraft’s approach to Supply Chain Management has something for everyone to learn and
apply in the workplace.